How Supply Chains Can Rely on Data to Remain Resilient through Uncertainty

The only certainty is that supply chains need to prepare for uncertainty. In the face of global emergencies, trade tensions, and economic concerns, supply chains work diligently to minimize the impact to their customers and communities. They do this by taking an agile approach that will allow them to prepare for the unknown and remain resilient in order to do what’s best for their employees, customers, community, and business.

While this is no easy feat for such a complex ecosystem, dealing with exceptions is nothing new for supply chains. Transportation and logistics teams are regularly handling delays and disruptions. Those that are ready to adjust plans during standard operations will be more likely to be resilient during a time of uncertainty. They will be more prepared to ask the right questions and understand all of the potential upstream and downstream challenges.

To create this resilient supply chain, companies are trying to gain more control of their processes and networks. As a recent Gartner report pointed out, “you cannot control what you can’t see.” It’s critical that organizations have data into their processes in order to increase agility and minimize the impact of an event on transportation operations. Here are a few ways data can help supply chains increase resilience and prepare for uncertainty.

Understand Your Delays to Better Manage Exceptions

With many global events, whether it be trade tensions or international epidemics, congestion around borders and ports increases. In most global supply chains, these points in the transportation process can’t be avoided.

For example, when the US planned to raise tariffs on Chinese imports in 2018, the LA/Long Beach port encountered significant delays and dwell times. Supply chains were increasing imports at quickly to avoid the potential tariffs. As many organizations has this same idea, the ports were not prepared, creating bottlenecks that impacted downstream supply chain activities.

During the uncertainty around Brexit, a survey of supply chain leaders found that customs delays in Europe of 30 minutes could bankrupt 10% of businesses. There are many scenarios that can cause border delays or port congestion, creating ripple effects that can have a big impact on businesses.

As organizations ship goods around the world, it’s essential to know when your freight will arrive at a port or border and what delays any congestion might cause. Armed with dynamic updates about any issues, they can get ahead of downstream problems that the delay might cause.

When handling disruptions due to COVID-19, a global buildings materials manufacturer needed to more effectively track shipments from their suppliers all the way to their end customer. They are taking high-fidelity tracking data and using it to plan upstream processes. With thousands of orders per day, they need to know when the order will hit a certain distribution center in order to fulfill when that inventory is in transit. By using predictive ETAs, they know exactly when the inventory is arriving, allowing them to fulfill the order without actually holding inventory at rest, creating unparalleled efficiency when time is critical.

As uncertainty requires supply chains to pivot plans quickly, data is even more critical to monitor the status of freight and remain agile throughout the entire shipment lifecycle.

Knowing Where Your Inventory is Located

During uncertain times, companies may need to make adjustments to what products are delivered to which stores or customers depending on the event and need. Based on project44 user data of 16 grocery chains in North America, grocery chain outbound shipments to stores jumped more than 25% week over week as of March 14, with March 13 shipments 60% higher than normal.

Manufacturers and retailers may need to redistribute their inventory depending on the current situation. Retailers might need to distribute more water or cleaning supplies to a certain region. For example, after a hurricane, impacted areas will need more materials to rebuild. Home improvement stores will need to move more goods to that area depending on needs.

With the recent high demand for toilet paper, anti-bacterial wipes, sanitizer, and water, one retailer and grocer is using visibility to ensure they have the right products in the right stores based on demand. They are tagging certain POs to determine arrival times and gain the ability to track them in the system.

Without insight into where your inventory is located, it is nearly impossible to allocate products as needed. When you have real-time data showing exactly where all of your in-transit inventory is located, you can effectively redeploy inventory, which is critical in an emergency situation.

Analyze Data from Past Events to Identify Your Transportation Weak Spots 

With an in-depth analysis into transportation processes during past disruptions or uncertain events, supply chains can identify areas of improvement to increase agility for the future. They can look at lane performance and historical trends to inform their decisions, reviewing their response to other situations and evaluating their outcome.

While artificial intelligence (AI) technology in the transportation space is still developing, supply chains will soon be able to leverage machine learning to predict the impact of events. As events occur and supply chains consider their options to mitigate risk, they will be able to gain a more accurate assessment of the impact and figure out which path forward will deliver the best results.

In a 2019 webinar, Advanced Supply Chain Analytics with IBM Watson Supply Chain Insights, IBM’s Global Lead of Supply Chain Analytics for Watson Supply Chain, Rob Allen, explained how supply chains are using this technology to mitigate disruption.

“There’s a significant reduction in the time it takes to understand and identify: what is the best action, who are the right people to participate, what did we do last time, and what were the outcomes,” said Allen.

With advanced analytics and AI, supply chains can significantly reduce the amount of time it takes to mitigate disruptions. They can review what they did the last time a similar situation occurred and evaluate the outcomes.

Collaborating with Partners in Times of Uncertainty

When encountering a global event or uncertainty, there are many things a company has to consider. The supply chain industry is intertwined and incredibly interdependent. Sometimes this can make uncertainty seem even more daunting, but it’s important to remember that the entire community is in this together. We can all work together to make sure we’re supporting one another during uncertain times, making supply chains stronger and more resilient.

We have compiled a list of resources to share materials from the community with supply chains as they react to unexpected events and prepare for uncertainty in the future. You can find that resource library here.

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